Google Inc (NASDAQ:GOOG) recently acquired Waze, an Israeli mapping start-up for more than $1 billion, to maintain its leading position in web-based mapping service, which is one of the most critical aspects in the smartphone market.
Analysts at Barclays Equity Research believe that the acquisition of Waze could help Google Inc (NASDAQ:GOOG) increase its monetization opportunities.
According to Barclays Equity Research analyst Anthony DiClemente and his colleagues, Waze technology has the ability to update traffic situations or road closures in real-time, which is a big differentiation. The analysts emphasize that real-time technology will boost the value proposition of Google Maps, and make it more useful to consumers.
In addition, the analysts wrote, “As Google continues to innovate in the arena of connected and self-driving cars, we could envision Waze real-time technology being implemented in on-board navigation systems.”
DiClemente and his fellow analysts also perceive that Google Inc (NASDAQ:GOOG) could incorporate real-time technology with self-driving technology. The analysts maintained their overweight rating and $1,000 price target for shares of the company.
Meanwhile, Google Inc (NASDAQ:GOOG) said that the product development team of Waze will remain in Israel, and its business operations will be separate for the meantime. It will eventually boost its Maps apps using Waze technology and Waze products will also benefit from Google search.
Start-up Acquired By Google: Boam Bardin
In a blog post, Boam Bardin, chief executive officer of Waze, confirmed that the start-up is acquired by Google Inc (NASDAQ:GOOG), but nothing will change in the structure, brand, and services, and the company will continue to “innovate and to make a real-impact on drivers globally.”
Bardin wrote, “Choosing the path of an IPO often shifts attention to bankers, lawyers and the happiness of Wall Street, and we decided we’d rather spend our time with you, the Waze community. Google is committed to help us achieve our common goal and provide us with the independence and resources we need to succeed. We evaluated many options and believe Google is the best partner for Waze, our map editors, area managers, champs and nearly 50 million Wazers globally.”
On the other hand Brian McClendon, vice president of GEO at Google Inc (NASDAQ:GOOG) wrote in his blog, “Imagine if you could see real-time traffic updates from friends and fellow travelers ahead of you, calling out ‘fender bender…totally stuck in left lane! and showing faster routes that others are taking.”